Question
upstudy study bank question image url

1.3. Linda is very risk averse. She therefore decided to insure his household content with two insurers. The value of her household content is R 450000 . She has insured the content for the full value with both insurers. Choose the incorrect statement below. A. Linda's action is known as double insurance. B. Linda will be allowed to choose from which insurer she will claim in case of a loss. C. The double insurance will enable Mario to claim in full from both insurers, since he has paid premiums to both on the full value of his assets.

Ask by Knight Campos. in South Africa
Mar 14,2025

Upstudy AI Solution

Tutor-Verified Answer

Answer

Statement C is incorrect because Linda cannot claim the full amount from both insurers; instead, the insurance companies will share the responsibility based on the principle of contribution.

Solution

Sign in to Unlock Answers for Free!

A Learning Platform Trusted by Millions of Real Students and Teachers.

star-icon Unlock

Answered by UpStudy AI and reviewed by a Professional Tutor

Bonus Knowledge

Linda's strategy of insuring her household content with two insurers certainly showcases her desire for security, but it also leads her into the realm of double insurance, where the rules can get a tad tricky! While she may feel extra safe, should disaster strike, she can only receive compensation for the actual loss, not a full payout from both. Now, about those claims! When it comes to double insurance, Linda won't have the luxury of claiming the full insured amount from both insurers; instead, her payout will be proportioned according to the policies she holds. So, she's not doubling her benefits—only doubling her premiums! Time to navigate the fine print!

Related Questions

Latest Economics Questions

Try Premium now!
Try Premium and ask Thoth AI unlimited math questions now!
Maybe later Go Premium
Study can be a real struggle
Why not UpStudy it?
Select your plan below
Premium

You can enjoy

Start now
  • Step-by-step explanations
  • 24/7 expert live tutors
  • Unlimited number of questions
  • No interruptions
  • Full access to Answer and Solution
  • Full Access to PDF Chat, UpStudy Chat, Browsing Chat
Basic

Totally free but limited

  • Limited Solution
Welcome to UpStudy!
Please sign in to continue the Thoth AI Chat journey
Continue with Email
Or continue with
By clicking “Sign in”, you agree to our Terms of Use & Privacy Policy